Which of the following statements is true of pricing decisions?
A)Market-based pricing starts with a good understanding of customer needs and the benefits that a product offers relative to competitors' products.
B)The business with the lowest price will always offer customers the best economic value.
C)It is possible to implement market-based pricing with low levels of customer and competitor intelligence.
D)Competitors' product-price positioning and company product-price positioning are the two primary determinants in setting a cost-based price.
E)Cost-based pricing takes into account what the customer would be willing to pay for a certain level of product performance.

Question

Quizplus · Accepted Answer

Market-based pricing starts with understanding customer needs and the benefits a product offers relative to competitors' products. This approach focuses on the value of the product to the customer and what they are willing to pay for it. A low price does not always equate to the best value for the customer, as other factors such as quality, convenience, and reputation can also influence their purchasing decision. Additionally, implementing market-based pricing requires a good understanding of customer and competitor intelligence to make informed pricing decisions. Cost-based pricing focuses on the expenses incurred to produce a product, rather than the value it provides to the customer.

Which of the Following Statements Is True of Pricing Decisions